United States District Court, E.D. Virginia, Newport News Division
GLORIA J. HARRIS, Plaintiff,
UNITED STATES OF AMERICA AND, FREEDOM MORTGAGE CORPORATION, Defendants.
OPINION AND ORDER
HENRY COKE MORGAN, Jr., Senior District Judge.
This matter is before the Court on Defendant Freedom Mortgage Corporation's ("Freedom") Motion to Dismiss Complaint, Doc. 3, Defendant United States of America's ("USA") Motion to Dismiss, Doc. 18, and USA's Motion to Strike Jury Demand, Doc. 20. Freedom seeks its dismissal under Rule 12(b)(6) while USA asserts two grounds for dismissal, Rule 12(b)(1) and Rule 12(b)(6). See Docs. 3 & 18.
After considering the instant Motions as well as the supporting and opposing memoranda, the Court DENIES Freedom's Motion to Dismiss, DENIES USA's Motion to Dismiss, and GRANTS USA's Motion to Strike the Jury Demand for the following reasons.
This case centers on Freedom's January 31, 2012 foreclosure on the home of Plaintiff Gloria J. Harris ("Plaintiff). The property in question is located at 207 Kove Drive, Hampton, Virginia 23669 ("the Property"). Doc. 19 at 1.
A. Factual Background
Plaintiff and Freedom entered into a $350, 650 note payable on June 18, 2009. Am. Compl. ¶ 7. The Note included an acceleration clause requiring "at least 30 days" notice. Id. at ¶ 9. The note was secured by a deedoftrust against the Property. Id. at ¶ 7. Among many other provisions, the Deed of Trust signed by these parties required that prior to any acceleration of Plaintiffs loan, Freedom must provide notice of:
(a) the default; (b) the action required to cure the default; (c) a date, not less than 30 days from the date the notice is given to [Plaintiff], by which the default must be cured; and (d) that the failure to cure the default on or before the date specified in the notice may result in acceleration... [and (e)] the right to bring a court action to assert the non-existence of a default or any other defense.
Id. at ¶ 10. The Department of Veterans Affairs ("VA"), represented in this case by USA, agreed to financially back the note. Id. at ¶ 24.
The parties agree that Plaintiff did not make payments for the months of November and December of 2010, but appear at odds regarding the October 2010 payment. Compare id. at ¶ 16, with Doc. 19 at 4. In response to Plaintiffs missed payments, Freedom sent notice of loan acceleration via certified mail on December 9, 2010 ("Notice Letter"). Am. Compl. ¶¶ 13-14. Although Plaintiff does not remember receiving the Notice Letter, she admits that "it is possible that she did." Id. at ¶ 15. The remainder of Plaintiffs claims against Freedom are based upon alleged faults in the Notice Letter and not a total failure to send notice; therefore, the Court must conclude, for the purposes of this Order only, that the Notice Letter was received by Plaintiff.
The Notice Letter, attached to Plaintiffs Amended Complaint as Exhibit C, notified Plaintiff of her recently missed payments and advised her that she had until January 8, 2011 before her loan was accelerated and the foreclosure process begun. Id. at Ex. C.
The Notice provided to Plaintiff also indicated that "[i]f another monthly payment becomes due... you will need to add this payment amount... in order to reinstate this loan." Id . Finally, the Notice indicated that due to the fluctuating nature of interest payments, the amount listed in the Notice "may not accurately reflect the debt owed" and provided a contact number to use if Plaintiff had any inquiry about "payment amounts." Id.
When Plaintiff failed to make the requested payment, Freedom proceeded towards foreclosure of the Property, Id. at ¶¶ 18-19. A foreclosure sale was conducted on January 31, 2012 and Freedom placed the highest bid. Id. at ¶ 22. Acting as the backer of Plaintiffs loan, the VA paid a "substantial sum" to Freedom in exchange for the rights to the Property acquired at the sale. Id. at ¶ 24. Transfer of the Property to the VA occurred on April 9, 2012. Id. at ¶ 27.
After the sale, Freedom reported the foreclosure to credit bureaus, resulting in damage to Plaintiffs credit rating. Id. at ¶ 33. The VA proceeded against Plaintiffs possession of the Property in Virginia courts, ultimately prevailing when Plaintiffs appeal was denied by the Virginia Supreme Court on April 11, 2014. Id. at ¶¶ 34-37. A sheriffs eviction was scheduled ...